President Ahmadinejad, who sparked a similar controversy in October when he said Israel “must be wiped off the map”, also repeated his view that the Jewish state was a “tumour”.
“Now that you believe the Jews were oppressed, why should the Palestinian Muslims have to pay the price?” the hardline president asked in an interview with Iran’s Arabic-language satellite channel, Al-Alam.
“Why did you come to give a piece of Islamic land and the territory of the Palestinian people to them?
“You oppressed them, so give a part of Europe to the Zionist regime so they can establish any government they want. We would support it,” he said, according to a transcript of his original Farsi-language comments.
“So, Germany and Austria come and give one, two or any number of your provinces to the Zionist regime so they can create a country there which all of Europe will support and the problem will be solved at its root,” he said.
“Why do they insist on imposing themselves on other powers and creating a tumour so there is always tension and conflict?”
Al-Alam said Mr Ahmadinejad was speaking in the holy city of Mecca in Saudi Arabia where he was attending a two-day meeting of the Organisation of the Islamic Conference that opened on Thursday.
“Is it not true that European countries insist that they committed a Jewish genocide? They say that Hitler burned millions of Jews in furnaces … and exiled them,” Mr Ahmadinejad told Al-Alam.
“Then, because the Jews have been oppressed during the Second World War, therefore they (the Europeans) have to support the occupying regime of Qods (Jerusalem). We do not accept this,” he said.
“Unfortunately this is not the first time that the Iranian leader has expressed outrageous and racist views towards Jews and Israel,” said Israeli foreign ministry spokesman Mark Regev.
“I hope that these outrageous remarks will be a wake-up call to people who have any illusions about the nature of the regime in Iran.”
Israel’s views were echoed by the United States, its closest ally.
“It just further underscores our concerns about the regime in Iran. And it’s all the more reason why it’s so important that the regime not have the ability to develop nuclear weapons,” said White House spokesman Scott McClellan.
German Chancellor Angela Merkel said Ahmadinejad’s combative suggestion that Israel was “totally unacceptable.”
French President Jacques Chirac said he completely agreed with Merkel and that France was outraged by the Iranian leader’s statement.
Austrian Chancellor Wolfgang Schuessel, speaking after a meeting with US President George W Bush, called the remarks “an outrageous gaffe, which I want to repudiate in the sharpest manner.”
German Foreign Minister Frank-Walter Steinmeier said the EU’s nuclear diplomacy is “not made easier by the fact that Mr Ahmadinejad comes up with new ideas that the people of Israel could move to Germany and Austria, to resolve the Middle East problem.”
Italian Prime Minister Silvio Berlusconi also condemned the remarks.
After calling for Israel to be “wiped off the map” in October, Iran was chastised by the UN Security Council and drew fierce condemnation from the West, already alarmed over Iran’s nuclear ambitions and ballistic missile program.
A scheduled visit to Iran by UN Secretary General Kofi Annan was also called off as a result of the remark.
Mr Ahmadinejad’s tone has also been a major departure from his pro-reform predecessor Mohammad Khatami, who had eased anti-Western rhetoric and sought to bring Iran out of international isolation by calling for a “dialogue among civilisations.”